Yuri Milner during the interview on SXSW: "Facebook, Google and Wikipedia have amazing network effects. Chances are that those are long survivors". Source: Getty Images

In an interview at the annual South by Southwest festival in Texas, businessman and prominent investor Yuri Milner explains why he believes online network services such as Facebook, Google and Wikipedia will last for at least another century.

There are not too
many Russians who participated in the annual South by Southwest festival in
Austin, Texas, this year, but this one is hard to miss. Yuri Milner, a Facebook
investor and the founder of DST Global investment fund, was interviewed by
Vanity Fair contributing editor Bethany McLean.

During the interview,
Milner predicted that Facebook, Wikipedia and Google will last at least a
century, because of their particular qualities. “All three have amazing network
effects. Chances are that those are long survivors,” said Milner, as The
Washington Post and Bloomberg reports.

These services are so
deeply integrated in our lives that we can hardly imagine how to do without
them, Milner believes, doubting if we could live and work as we do now if Google
cut off even for a while. In Milner's opinion, Wikipedia will stay because of an
absence of competitors.

Yuri Milner became
known worldwide after he backed Facebook in 2009. "I saw someone who was
clearly a genius; it didn't take me a lot of time to recognize that,"
Milner said about Facebook's founder Mark Zuckerberg. Milner invested $200
million for a 2 percent stake in Facebook, despite many doubts at the time
about it being the right choice.

Related

One of Milner's rules
for investing is to be ready to go against public opinion. He explained in the
interview: “It’s almost a theorem, if you want to get disproportionate returns,
to go against flow. Otherwise, returns will not be as high. If everybody thinks
it’s a great idea, returns would be under pressure… It’s a positive indicator
if you go against the flow — for not only investors but founders as well. You
almost have to have it, if you want to be disproportionately successful.”

Some of Milner’s
other investing rules created what now is called “DST deal.” By this type of
collaboration, founders retain principal control of the company and investors
do not receive a seat on the board. This started with Facebook and was then
copied by many other IT companies.

“We make it so the
legal documents actually reflect this trust in founders. This came to be called
a ‘DST-type’ deal,” said Milner. “We’re backing the founders not only
emotionally but also in a legally binding way. That was a new element. Not many
people were using it just a few years back, but many are using it now.”

Meanwhile, on social
media and blogs, representatives from the IT industry reacted to Milner’s words
at SXSW. For example: “Yuri Milner on profit vs purpose. Seems to be theme at
SXSW this year. The big idea is a better motivation than money. #sxsw2013,”
wrote @marratu1 on Twitter.